Comprehensive car insurance premiums have increased sharply by 14% (£72) since the third quarter of 2021, with UK motorists now paying £586 on average, according to the latest Confused.com Car Insurance Price Index in association with WTW (NASDAQ: WTW), a leading global advisory, broking and solutions company.
Although 14% is a hefty increase, it’s way behind the jump in house prices, energy bills or food prices during 2022. Some foodstuffs have risen by 30%, while diesel is around £1.82 per litre, compared to £1.37 in September 2021, also up about 33% year-on-year.
Car insurance premiums have seen consecutive annual increases for the last three quarters, following the implementation of the new FCA pricing rules on 1 January 2022. Motor insurance premiums have now also risen for four quarters in a row, with a significant rise of 6% (£32) recorded in just the last three months, according to the longest established and most comprehensive car insurance price index in the UK. The index is based on price data compiled from over six million customer quotes per quarter.
Tim Rourke, UK Head of P&C Pricing, Product, Claims and Underwriting at WTW, said: “Car insurance prices have risen across the board as insurers have found it increasingly challenging through 2022 to absorb a bitter cocktail of rising cost pressures. Soaring inflation, rising accident frequency due to a post-pandemic increase in road traffic, higher used car prices, and a supply chain crisis resulting in more costly repairs have caused the biggest annual jump in premiums for five years.”
LONDON BOYS, MANC LADS
Inner London saw the greatest annual rise in England, where insurance premiums increased by 16% (£132), and remains the most expensive region with prices now on average at £936. Manchester and Merseyside (£737) continues to be the most expensive area outside of the capital, and only £4 less than average premium prices in Outer London (£741).
More locally focused data shows motorists in West Central London, Aberdeen and Dumfries experienced the sharpest annual rise of 23% taking their average premiums to £1,204, £434 and £392 respectively. West Central London also continues to be the most expensive postcode in the country, while Llandrindod Wells in Wales remains the cheapest town in the UK, with drivers paying an average bill of £364 in the third quarter of 2022 for comprehensive car insurance.
Male drivers aged between 21 and 25 saw the greatest percentage increase of 18% (£190) during the last 12 months, taking their premiums to £1249. Following a 17% annual shift in prices (£248), male drivers aged between 17 and 20 now pay on average £1673, which is the most of any demographic and £424 higher than the next highest age group. Female drivers aged between 66 and 70 continue to benefit from the lowest annual premium at £287.
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